RaboResearch: Milk production growth, consumer confidence low
RaboResearch expects the average milk price to be around €54 per 100 kgs this year. A slight drop in the milk price is expected in the second half of 2025.
Despite financial incentives, milk supply in Europe lagged behind, but supply recovered in April thanks to favourable margins and low feed prices. However, growth is coming from other producing regions, which means that milk production will grow by 1% in total this year.
Demand for dairy is good, but it could fall back
Demand for dairy in Europe remains good, but disappointing economic figures, especially in Germany, could put a brake on consumption in the autumn and winter of 2025. Rabobank analysts see the growth forecast for the eurozone being adjusted from 1.3% to 0.9%.
There are also uncertainties elsewhere in the world. Consumer confidence in the United States is at an all-time low, and China is in economic difficulty. Dairy sales are also falling in other regions.
Dairy herd health
Rabo analysts also express their concerns about the risk of animal diseases, such as foot and mouth disease in Germany, Slovakia and Austria. The bluetongue virus could resurge between May and September, while vaccinations offer only limited protection.
Manure
RaboResearch remains positive about the Dutch dairy farming sector – but adds a lot of manure use space has already been used, which means that manure disposal will be an issue in the second half of 2025. Storage capacity is crucial to remain flexible.
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